Demystifying
Statistical Sampling: Tests of Dollars
(a.k.a., Dollar Unit, Monetary Unit, PPS
Sampling)
When performing Tests of Details (a.k.a., Substantive
Testing), auditors utilize methods of sampling which either address dollars or
characteristics of the population (mean, ratio of errors). Multiple methods
exist: ratio, mean-per-unit and dollar unit. Most auditors prefer dollar unit
(where each dollar is a potential sampling unit) because it “biases” you (the
only time bias is a good word) towards the BIG DOLLARS.
Dollar unit comes with a unique set of assumptions (many
of which never seem to get explained … or sink in). So we need to learn the
multiple methods, and their underlying assumptions so that we may apply the
proper method in the right audit situation.
Lots of FAQs will be addressed along with work-paper
design. We will also review the audit literature which supports stat sampling.
We will discuss actual business cases with huge
recoveries.
THIS CLASS IS 100% HANDS-ON, WITH
SEVERAL COMPUTERIZED CASES, USING A GREAT FREEWARE PACKAGE DEVELOPED BY A
FEDERAL AUDIT AGENCY (and windows driven). | 
